Consider the following statements:
1. The Self-Help Group (SHG) programme was originally initiated by the State Bank of India by providing microcredit to the financially deprived.
2. In an SHG, all members of a group take responsibility for a loan that an individual member takes.
3. The Regional Rural Banks and Scheduled Commercial Banks support SHGs.
How many of the above statements are correct?
[amp_mcq option1=”Only one” option2=”Only two” option3=”All three” option4=”None” correct=”option2″]
This question was previously asked in
UPSC IAS – 2023
– Statement 2 is correct. A core principle of SHGs is collective responsibility or joint liability. Members guarantee each other’s loans, which encourages timely repayment and peer pressure.
– Statement 3 is correct. The SHG-Bank Linkage Programme is implemented by commercial banks (including Scheduled Commercial Banks), Regional Rural Banks (RRBs), and Cooperative Banks, linking SHGs to formal financial institutions.